What is the difference between a debit card and a credit card?
The basic difference between a debit card and a credit card is that the debit card gives you access to your own money whereas the credit card is a form of loan and it accesses a line of credit offered by your bank. Put in simple terms, a debit card is a Buy Now Pay Now option while a credit card is a Buy Now Pay Later option.
A debit card is connected to your everyday current account. A credit card is connected to its own separate account, which has a usage limit. Once this limit has been reached, the card can not be used unless the used amount is paid off, either in full or part of it. Most credit cards require some form of minimum monthly repayment, often paid by Direct Debit.
It’s the difference between “debit” and “credit.” Debit means “subtract.” When you use a debit card, you are subtracting your money from your own bank account. Debit cards allow you to spend only what is in your bank account. It is a quick transaction between the merchant and your personal bank account. Credit is money made available to you by a bank or other financial institution, like a loan. The amount the issuer allows you to use is determined by your credit history, income, debts, and ability to pay. You may use the credit with the understanding that you will repay the amount, plus interest if you do not pay in full each month. You will receive a monthly statement detailing your charges and payment requirements. What you should know about debit cards: • Obtaining a debit card is often easier than obtaining a credit card. • Using a debit card instead of writing checks saves you from showing identification or giving out personal information at the time of the transaction. • Using a
A debit card is one which is associated with your bank or building society account. Payments made using a debit card are paid immediately from your account. You must have funds in your account to honour the payment you are making. Your bank/building society statement will provide you with details of payments that have been processed using your debit card. A credit card is a card not normally associated with your bank or building society account but a separate credit account with a pre-agreed spending limit. If you make a payment with your card beyond the agreed spending limit the payment you make will not normally be honoured. You must ensure you have sufficient funds available on your credit card account before making a payment. The company with whom you have your credit card account will send you a statement showing the details of all payments and transactions processed. This will be a separate statement to that for your bank or building society account.
